PriceSpy - Black Friday Report 2021

Despite originating in the USA, in recent years the flash sale day known as ‘Black Friday’ has grown exponentially in popularity across the world, including in New Zealand. 

So, what do Kiwis really think about Black Friday? And how has the Covid-19 global pandemic impacted our buying habits, price points of products and availability of goods on everyone’s wishlists? 

Using insights captured from a new PriceSpy-commissioned survey on New Zealanders along with insightful PriceSpy data, we are able to answer all of these questions and more in this Black Friday Report.

*More information about the survey and how it was carried out can be found at the bottom of this report.

Black Friday’s popularity isn’t waning. But can it continue to grow at the same rate?

Popularity for Black Friday is at an all-time high in New Zealand, according to results from PriceSpy’s new survey, with just over three quarters (76 per cent) of Kiwis saying they’ve previously bought something on Black Friday or Black Week. That’s up almost a fifth (18 per cent) compared to last year (2020) and up by almost a quarter (23 per cent) from 2018.

Even though there has been significant growth for the sale day,  PriceSpy predicts Black Friday as a standalone shopping day won’t increase in popularity as aggressively as it done so previously - this is because the sale day has now become so big, it simply can't grow at the same rate we have seen. Online sales however will be noticeably higher this year due to Covid-19 and the overall growth online shopping has seen.

Indications are that this year’s shopping trend is more likely to be around Black Week, rather than a standalone sales day.

Black Friday is becoming Black Week

Following global trends, Black Friday is starting to evolve - and New Zealand shops and online stores are beginning to take advantage of the now well-established shopping day, with discounts being offered to shoppers over the course of an entire week rather than limiting them to just a single day.

Below, PriceSpy’s Price Index reveals the total price change per day in New Zealand between 1 November and 9 December 2020**.  Prices dropped around two weeks ahead of Black Friday. Shortly after, they increased before falling again from around 23 to 30 November (note: Black Friday took place on 27 November 2020).

And it seems consumers are responding to the Black Week discounts being offered - the graph below reflects consumer buying interest for Black Friday 2020 on PriceSpy.  Interest clearly starts to peak for Black Friday from around 20 November, seven days out from Black Friday.

And Black Friday has now become so popular:

• One in two Kiwis (51 per cent) say they shopped on Black Friday or Black Week last year (2020), up 11 per cent on the year prior (40 per cent in 2019)

• And almost two thirds of Kiwis (65 per cent) say they are likely to buy something on Black Friday or Black Week this year, growing 15 per cent year-on-year

And it seems Kiwi retailers are responding to the growth Black Friday has witnessed across the last few years, with many offering early, attractive discounts ahead of the sale day, to encourage shoppers to spend earlier than they ordinarily would - Black Friday is fast becoming Black Week.

This year in particular, extending the sale shopping season and offering a whole week of Black Friday-style sales may help encourage shoppers to spend early, spend big and over a more prolonged period of time. And many hard-hit New Zealand retailers will welcome early pre-Christmas spending after months of lockdowns and restricted trading. 

If shopping early, beware of price hikes!

While Black Week sounds like good news for those wanting to start their sale shopping earlier and have more time to grab a bargain or two, early sale shopping may not always deliver.

PriceSpy found almost one in ten products (eight per cent) listed on its website received a price hike ahead of the sales period to then be reduced on Black Friday, making the discount appear better than what it was.

Even though it’s true that many products drop in price on Black Friday, for example:

• Just over two fifths (42 per cent) of all products listed on PriceSpy dropped in price on Black Friday 2020 (Black Friday 2020 vs 1 November)

• And almost a fifth (18 per cent) of all products listed on PriceSpy reduced in price by at least 10 per cent or more on Black Friday in 2020

But not all products offer a great deal!

• Across the same period, just over a tenth (12 per cent) of all products listed on PriceSpy received a price hike on Black Friday (Black Friday vs 1 November 2020).

Unfortunately, price hikes are a sneaky but common trick. Black Friday can offer some really decent deals if you’re savvy, but it’s important to be vigilant and do some price research on a comparison site like PriceSpy to make sure you’re truly getting the best deal and not falling for faux discounts.

Most-popular doesn't always offer the best discounts

And when it comes to New Zealand’s most-wanted products it’s safe to say that Black Friday isn’t necessarily the best time to buy. 

PriceSpy figures show that three fifths (60 per cent) of the most-popular products*** from Black Friday 2020 were actually cheaper to buy in the months leading up to Black Friday, highlighting the fact that sales happen all year round.

What’s more:

• Only 20% of the most-popular products were cheapest to buy on Black Friday

• 60% of the most-popular products could be purchased for less outside of Black Friday

Black Friday 2021 - what can we expect?

More Kiwis plan to shop this Black Friday

It’s almost two years since the Covid-19 pandemic turned the world upside down and life as we knew it changed for everyone.  

After a difficult and challenging time with New Zealanders navigating their lives around restrictions, alert levels and lockdowns, this year’s survey revealed more Kiwis than ever (65 per cent) are planning to shop across Black Friday and Black Week.

More than half of those surveyed (51 per cent) said they shopped on Black Friday or Black Friday Week in 2020, which is up 11 per cent on 2019.  

Despite this big jump, year-on-year spending between 2019 and 2020 actually dropped - with the average spend on Black Friday or Black Week in 2020 sitting at $285.80 vs $311.50 in 2019. 

But with lockdowns still affecting areas of New Zealand and more shoppers looking to take part in Black Friday or Black Week this year, will we see an increase in spending? PriceSpy’s consumer survey suggests so!

Kiwis are looking to spend more this Black Friday!

And there’s more good news for retailers - almost two fifths (38 per cents) of survey respondents say they intend to spend over $500 on Black Friday/during Black Week this year, up 18 per cent year-on-year. What’s more, the average amount people intend to spend is $782.50, up $318 (or 68 per cent) on last year.

The pandemic has been a tough ride for many.  Over the last year, consumers have not always been able to visit shops, socialise or go on international holidays - and these past few months have been understandably difficult for many New Zealanders contending with lockdowns. 

As a result of not being able to live life ‘normally’, PriceSpy’s survey findings suggest some are looking to spend money they have potentially saved in lockdowns by not going on big international holidays or eating out etc on big-ticket items - and the Black Friday sales offer the perfect opportunity to spend. 

Even though many retailers will have had a rough time recently, this year’s Black Friday sales could offer a much-needed boost.

What kind of discounts do Kiwis expect and will Black Friday deliver?

Expectations vs reality

Surprisingly, more than half (55 per cent) of survey respondents had ‘little’ or ‘very little’ trust in the discounts being offered by retailers during sales like Black Friday/Black Week.

This may be because people’s expectations are set pretty high as according to PriceSpy’s survey, the average discount people expect to save this year is just over a third (34 per cent). 

In reality, the discounts offered are considerably less:

• Even though almost a fifth (18 per cent) of all products listed on PriceSpy offered a discount equating to 10 per cent or more on Black Friday 2020, of the items that were discounted, the average price drop was just -20 per cent.

There are many factors that will impact the price of an item. As well as watching out for price hikes in the lead-up to Black Friday that make products appear cheaper on the day, this year we are also having to contend with the ongoing knock-on effect caused by the pandemic. 

Retailers are having to contend with rising shipping costs, manufacturing delays and more expensive operational costs. Costs that may well be passed on to consumers.  Essentially, now more so than ever, it’s really important for people to do their price research.

What will Kiwis buy this year?

Based on what Kiwis were looking to buy last Black Friday, here is the list of most-popular shopping categories.

* The PriceSpy consumer omnibus survey in 2021 was conducted by 3Gem, in October 2021, on 500 New Zealand respondents. 

* The PriceSpy consumer omnibus survey in 2020 was conducted by 3Gem, in October 2020, on 500 New Zealand respondents.

* The PriceSpy consumer omnibus survey in 2019 was conducted by Savanta, in October 2019, on 506 New Zealand respondents. * The PriceSpy consumer omnibus survey in 2018 was conducted by VIGA (now Savanta), on 30 October 2018, on 527 New Zealand respondents.

** PriceSpy’s Price Index is a daily updated chain index that tracks price changes across all categories, brands and markets over time. Products are weighted by popularity, determined by the number of clicks-outs received and the number of stores offering the product. The index works much like a stock index, where daily price changes are used to calculate the accumulated index, and where company size corresponds to product popularity. Old products will gracefully disappear and new products enter the index. The index shows the relative price change of already existing products from the day before.

*** Most-popular Black Friday products - pricing research

 

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